I thought you had the theory that if a stock has had a large price increase then the positive risk reward dramatically reduced? Have I got that wrong? My thinking is just following that if the SP has fallen a long way and there is something actually happening near term then the risk v reward must then be higher towards the positive.
The reality is that the SP will move into the 3's most likely before any results. Assuming of course no further delays or bad news. If results are poor then back to around 2c. If results are fair then around 5c. If results are above fair then we have to do some serious number crunching.
What I don't like is that the register is/was full of short term punters. This is obvious from how far the sell down has gone. This also means that on the next leg up there will most likely be a lot of trading. Again the trading has surprised me somewhat given the amount of shares on issue and how many held by top 20. Thats the market though, it never ceases to surprize!
RCR Price at posting:
2.5¢ Sentiment: Buy Disclosure: Held
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